India’s crude imports rose about 4.2% in March to 19.03 million tonnes from a year earlier, government data showed on Monday, as consumption picked up in the world’s third-largest oil importer after COVID-19 curbs were eased.
Crude imports for the month were also 8.2% higher from February, according to data from the Petroleum Planning and Analysis Cell.
India’s fuel demand had scaled a three-year peak in March, with petrol sales hitting an all-time high, as demand rose and the market built up supplies ahead of expected price increases.
“The increase in imports can be attributed to demand recovery; COVID curbs have eased, there is pick-up in the industry and economy with schools, colleges and all opening,” said Prashant Vasisht, vice president and co-head, corporate ratings at ICRA.
“Also, Indian companies, both from the private and public sector, are not shying away from buying and utilizing cheaper crude available from Russia.”
India has bought more than twice as much oil from Russia since it invaded Ukraine as in the whole of 2021, at a time when Western sanctions have prompted many oil importers to shun trade with Moscow.
Imports of oil products rose 9% month-on-month, but were down 9.5% from 2021 at 3.62 million tonnes.
Exports of oil products climbed 10.9% from a year earlier and of the total 6.74 million tonnes exported in March, diesel accounted for 3.37 million tonnes.
India – Asia’s third-biggest economy – holds surplus refining capacity and is a major exporter of refined fuels.
“A lot of European companies are opting not to buy Russian crude and refined products. And even before the war, there was a lack of stock levels of diesel in Europe. So, since there’s healthy demand, it has lead to increase of product exports for India,” ICRA’s Vasisht said.